Santa came with another positive surprise for the US, but despite the snow, there wasn't any Christmas miracle for Canada.
The US GDP release was indeed a strong hit, coming at an annualized 4.3% (with the price index coming for Q3 at 3.7% vs 2.7% expected).
Stellar numbers on the surface, but the strong data may raise a few questions.
A significant portion of this growth could be driven by a sharp decrease in imports, which mathematically boosts the headline GDP figure even if domestic demand isn't accelerating at the same pace.
It’s a classic accounting quirk that could mask underlying softness—or at least, make the economy look hotter than the labor market suggests.
Industrial production offered a glimmer of stabilization, confirming your figures with a -0.1% read for October and a +0.2% rebound in November, still totalling for a two-month (slight) increase.
We will likely have to wait for the final yearly publications to see if this is a genuine rise.
Morning Data for the US and Canada – MarketPulse Economic Calendar.
The implication is tricky: if the economy is truly running at a 4% with sticky inflation (that 3.7% deflator is hard to ignore), the Fed has plenty of reasons to keep rates higher for longer. A theme that equity bulls won't appreciate much.
Yet, the S&P 500 doesn't seem to care, shaking off an open gap-down but overall seesawing action for Stocks.
S&P 500 (CFD) 10M Chart – December 23, 2025 – Source: TradingView
North of the border, despite cold and snow, Christmas hasn't brought its gifts.
Canada's cutting cycle—slashing rates from 5.50% to 2.25% since mid 2024—hasn't yet sparked a revival, confirmed by the disappointed -0.3% GDP print for October.
But as GDP is a lagging data, and employment showed decent upside, the upbeat data should reflect in the GDP only later next year.
Let's explore reactions to the data with our Market overview.
Market Outlook 1H Charts for S&P 500, Oil, 10-Year Bonds, Gold, Bitcoin and the USD. December 23 – Source: TradingView
Except for metals which are once again going bonkers, the session is very typical of a Christmas trading day.
Volatility should compress as we approach the rest of the day and the end of the year.
Of course, keep an eye on any geopolitical disruptions that could be the only real factor for movement, particularly if nobody is there to absorb liqudity shocks. But as long as nothing happens, except a slow, sideways grind for the next few weeks.'
Safe Trades and Merry Christmas!
Follow Elior on Twitter/X for Additional Market News, interactions and Insights @EliorManier
Opinions are the authors'; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. The provided publication is for informational and educational purposes only.
If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please refer to the MarketPulse Terms of Use.
Visit https://www.marketpulse.com/ to find out more about the beat of the global markets.
© 2025 OANDA Business Information & Services Inc.
